This article first appeared on GuruFocus .
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Total Revenue:Research segment revenue was $293 million, up 4%; Learning segment revenue was $93 million, down 20%.
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Research Publishing Revenue:Increased 12%, with $13 million from Emerald and the balance from Open Access growth and AI licensing; excluding Emerald, publishing grew about 6%.
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Research Solutions Revenue:Declined 30%, almost entirely due to the prior year AI licensing comparison.
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Learning Revenue (Academic):$45 million, down 20%, with $8 million of prior year AI licensing and declines in print, offsetting growth in digital content and courseware.
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Learning Revenue (Professional):$48 million, down 20%, reflecting $5 million of prior year AI licensing, softer consumer demand in retail, and softer corporate demand in assessments.
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AI Revenue:$14 million in the quarter, with $10.5 million from model training and $3.5 million recurring; a further $14 million is contracted across Q2 and Q3.
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Adjusted EBITDA:Down 4% year-over-year; Research adjusted EBITDA was $87 million, up 9%, with margin up 130 basis points to 29.6%; Learning adjusted EBITDA was $14 million, with margin at 15.1% against 27.4%.
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Adjusted EPS:Down 10%, further impacted by higher net interest expense related to the Emerald acquisition.
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GAAP EPS:Loss of $0.23 compared to earnings of $0.22 in the prior year, largely due to restructuring charges and acquisition and integration costs.
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Free Cash Flow:Use of $70 million against a use of $100 million a year ago; full year outlook of $205 million is on track.
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Net Debt to EBITDA:2.7 times on a trailing 12-month basis, against 1.9 times a year ago; pro forma leverage is 2.1 times including Emerald synergies.
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Capital Expenditures:$14 million against $15 million a year ago; full year CapEx expected to be approximately $80 million, up from $65 million.
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Dividends and Repurchases:Returned $33 million through dividends and repurchases; raised the dividend for the 33rd consecutive year.
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Emerald Contribution:Added $13 million to the top line and $5 million to adjusted EBITDA at a margin above the segment average; acquired for approximately $450 million net in cash at roughly 7 times adjusted EBITDA.
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Corporate Expenses (Adjusted EBITDA basis):$33 million in the quarter, down $8 million or 19%.
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Submissions:Up 31% year-over-year.
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Publishing Output:Up 8% year-over-year.
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Customer Retention:Remained above 99% in the calendar 2026 general renewal season.
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Advanced Journal Portfolio:More than 30 journal titles with revenue of $70 million growing at strong double digits.
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Clinical Outcome Assessments Revenue:Q1 revenue rose by more than threefold year-over-year.
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Subscription Knowledge Feeds Customers:Expanded to 23 across five industry verticals.
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Nexus Licensing Service Partners:Total increased to 71.
Release Date: September 03, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Research publishing revenue grew 12%, driven by strong global demand, record submissions (up 31%), and the addition of Emerald Publishing.
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AI revenue reached $14 million in Q1, ahead of pace for the full-year target of over $50 million, with an additional $14 million already contracted for Q2 and Q3.
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Research adjusted EBITDA margin expanded by 130 basis points to 29.6%, driven by cost savings and the high-margin contribution from Emerald.
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The company was selected as the sole scientific publisher for the US Department of Energy's Genesis Mission and a founding data partner for CuspAI's materials foundry, validating its strategic position in the AI economy.
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The clinical outcome assessments business is growing rapidly, with Q1 revenue rising more than threefold, and the company launched its new spectral analysis API portfolio for laboratory markets.
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Customer retention in research remained above 99% following the calendar 2026 renewal season, and the company raised its dividend for the 33rd consecutive year.
Negative Points
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Total revenue declined due to a tough prior-year comparison of $29 million in AI licensing revenue, which was not repeated in Q1 of fiscal 2027.
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The Learning segment faced significant headwinds, with revenue down 20% due to soft market conditions in professional publishing and a prior-year AI licensing comparison.
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Adjusted EPS decreased 10% year-over-year, impacted by higher net interest expense related to the Emerald acquisition.
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GAAP EPS was a loss of $0.23, largely due to restructuring charges and acquisition and integration costs associated with the Emerald deal.
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The professional publishing market remains soft, with continued pressure from retail channel inventory normalization (e.g., Amazon) and weaker consumer demand.
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Free cash flow was a use of $70 million in Q1, and net debt to EBITDA rose to 2.7 times (1.9 times a year ago) due to the Emerald acquisition.
Q & A Highlights
Q: Organic revenue growth in research excluding AI revenue and Emerald was 5%. How does that compare to peers in the market overall, and how does that enhance your confidence in your mid-single-digit growth outlook for the business? A: Matt Kissner (CEO): We are growing along the same lines with the leaders in the market. Our confidence is driven by strong leading indicators and KPIs. While this is a seasonally slow quarter for that business, we have confidence in the full-year guidance because our signals are all quite strong. Craig Albright (CFO) added that the long-term market growth rate is in the 3% to 4% range, and Wiley is seeing similar trends, with momentum expected to build throughout the year.
Q: Looking at Q2, remind us how much AI-related revenue you generated last year in Q2 and what your expectations are for this quarter? A: Craig Albright (CFO): In Q2 of last year, we generated around $6 million in AI revenue, with a similar number repeated in Q3 and Q4. We have already contracted for another $14 million of AI licensing revenue to be realized across Q2 and Q3 of this year. While these deals are lumpy, we see continued phasing in line with the prior year.
Q: Can you talk about what you've seen so far at Emerald, since it's been about two months since the acquisition? Any surprises, good, bad, or otherwise? A: Matt Kissner (CEO): There are no surprises. It is a really good fit with our journal portfolio, and the signals are running all green. We are ahead of the pace we initially established. Craig Albright (CFO) added that the working relationship between the teams is positive, and they are on track to achieve the full run rate of $30 million in synergies by year three, running slightly ahead in the first year.
Q: Can you provide a deeper dive into the recent partnerships, starting with IQVIA? Is that generating meaningful revenue, and what is a reasonable expectation? A: Matt Kissner (CEO): IQVIA is a terrific example of our partnership network enabling us to punch above our weight. It is a strategic partnership, not just a licensing deal, leveraging our clinical outcome assessments with their established distribution. Craig Albright (CFO) noted that clinical outcome assessments grew from hundreds of thousands of dollars to $11 million last year, and we are on the front end of something really big with another great year of growth expected.
Q: How are things progressing with OpenEvidence, Anthropic, AWS, and others? How should we think about the revenue models and financial perspective for '27 and the next few years? A: Craig Albright (CFO): We are pleased with the early stages of the work with OpenEvidence, which was a $15 million agreement over 5 years. It is a modest add but a great example of commercial licensing. We continue to see promise of that expanding, though it is still early days. Matt Kissner (CEO) added that they have added more content to the agreement and that OpenEvidence's strong footprint in the US physician market creates a terrific opportunity to leverage our content for new revenue streams.
Q: What was the impact of Amazon reducing inventories this quarter, and when do we cycle against that? Excluding print and digital books, what was the organic growth rate for the remaining learning businesses? A: Craig Albright (CFO): The significant reduction in inventory through the Amazon channel impacted the trade publishing area of the professional segment, with the toughest comparison occurring in late August. There has also been some softness in demand. However, the academic segment is very healthy, driven by digital content, courseware, and Inclusive Access. Assessments were light in Q1 but are expected to improve. We are managing the business with discipline, and trends should normalize against the prior year impacts.
Q: How should we think about the cadence of top-line growth, margin expansion, and EPS for the year? A: Craig Albright (CFO): Q1 is a seasonally lighter quarter, and we see momentum build as we go throughout the year. We are reaffirming full-year guidance, consistent with a seasonally soft first quarter picking up in Q2, Q3, and Q4. Matt Kissner (CEO) added that the drivers are strong growth in the foundational research publishing business, with newer growth engines in AI and data analytics gaining traction later in the year, all underneath continuous margin improvement.
Q: Can you elaborate on the recent partnerships with the US Department of Energy's Genesis Mission and CuspAI, and what role Wiley plays? A: Matt Kissner (CEO): Wiley was invited to be the sole scientific publisher in the DOE's Genesis Mission, a public-private partnership alongside NVIDIA, AWS, and Microsoft. Our role is substantive: we will make research intelligence tools available to researchers across all DOE National Laboratories and help shape the consortium's foundational knowledge layer. We also became a founding data partner for CuspAI's Materials Foundry, where CuspAI has licensed access to Wiley's material science content to train their platform, underscoring how our content is being integrated into AI systems driving scientific discovery.
Q: What is the current state of the AI revenue pipeline, and how is the mix shifting between model training and recurring revenue? A: Matt Kissner (CEO): In Q1, we realized $14 million of AI revenue, ahead of the pace needed for our full-year target. Of that, $10.5 million is from model training and $3.5 million is recurring. We have contracted a further $14 million to be realized across Q2 and Q3. The mix is shifting the way we want, with recurring revenue growing 2 to 3 times over the prior year. We have expanded our corporate customer base for subscription knowledge feeds to 23 across five industry verticals.
Q: Can you provide more detail on the margin expansion in the research segment and the cost savings initiatives? A: Craig Albright (CFO): Research adjusted EBITDA margin increased by 130 basis points to 29.6%, driven by the addition of Emerald and cost savings initiatives. Emerald added $5 million at a margin above the segment average. Most of the margin expansion was organic cost savings after continued investment in the advanced journal portfolio and clinical outcome assessments. Corporate expenses on an adjusted EBITDA basis came down 19%, building on the reduction from $166 million in fiscal '25 to $143 million in fiscal '26.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
